BAGHDAD (Reuters) -- Iraq's parliament has delayed a vote on a landmark pact setting a deadline for U.S. troops to leave, after agreeing to Sunni Arab demands to make it dependent on a referendum but rejecting other conditions.

The deal paves the way for U.S. troops to withdraw by the end of 2011, bringing closer to an end the 2003 U.S.-led invasion that ousted former dictator Saddam Hussein only to usher in years of sectarian bloodshed.

Once-dominant minority Sunnis are concerned their departure may dilute their influence in the Shi'ite-led country. They have proposed several political reforms they want adopted before they approve the pact.

The vote has been postponed to November 27.

The Iraqi National Dialogue, one of two Sunni political blocs whose blessing for the pact is seen as key to achieving a broad consensus, said it had demanded reforms that would defang efforts to find and try members of Saddam's former Baath party.

"We refused the Iraqi National Dialogue's two requests," said Jaber Khalifa, a senior member of the ruling Shi'ite coalition, the United Iraqi Alliance.

Iraq's Shi'ite-led government and its Kurdish partners, who together hold most of Iraq's 275 parliamentary seats, had already agreed in principle to Sunni demands for a referendum on the security deal in mid-2009.

The pact has been approved by the cabinet and signed with Washington.

Al-Maliki was probably popular enough after presiding over a sharp drop in violence to ensure approval of the U.S. troop deal in a referendum, said political analyst Kadhim al-Miqdad.

Keen To See Americans Go

On Baghdad's streets, where bodies once piled up overnight as death squads formed by majority Shi'ites battled Al-Qaeda-affiliated Sunni fighters, some looked forward to the eventual departure of American soldiers.

"After five years of occupation, fighting, and instability, Iraq must be put on a steady base that will protect its sovereignty. The pact is the beginning of the end of the occupation," said Imad Hameed.

A simple majority vote in favor of the pact had always appeared likely in parliament. But al-Maliki's government needed a broad consensus to satisfy Iraq's most influential Shi'ite cleric, Grand Ayatollah Ali al-Sistani.

Al-Maliki says the pact is Iraq's best hope for restoring its sovereignty whilst avoiding a return to violence.

The deal, which replaces a UN mandate, would give Iraq authority over U.S. troops, makes U.S. soldiers liable for some crimes committed when they are off-duty, and reins in private security firms that have enjoyed a bonanza during the war.

The 150,000-odd American troops in Iraq will have to quit the towns by mid-2009, and leave the country by the end of 2011.

That will strengthen the hand of al-Maliki, who will continue to be able to call on U.S. forces to fight violence whilst scoring nationalist points for being the one who ushered the invaders out. Some factions, including Sunnis who dominated Iraq under Saddam, fear al-Maliki will gain too much power.

"This is an important step in restoring sovereignty to Iraq, but the road is still long, mostly because, regardless of Maliki's positions, governmental institutions and the security apparatus remain weak, and stability is fragile," said Joost Hiltermann of the International Crisis Group.

While lawmakers negotiated, a blast in central Baghdad close to the fortified government and military Green Zone compound killed two people and wounded five.